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Great Gaps Persist in State Safety Nets, Interactive Policy Tool Shows

February 27, 2015 Comments off

Great Gaps Persist in State Safety Nets, Interactive Policy Tool Shows
Source: National Center for Children in Poverty

Today, the National Center for Children in Poverty (NCCP) launches an updated and enhanced edition of its 50-State Policy Tracker, a unique online tool for comparing safety net policies that are critical to the economic security of working families. The tool reveals striking variation among states, showing that state of residence has a major impact on whether low-income working parents succeed in making ends meet.

The Policy Tracker makes it easy for policymakers, journalists, social researchers, and advocates to quickly and accurately compare state policies and programs vital to the well-being of low-income families. It includes key state data for 10 important social programs:

  • Child care subsidies
  • Child and Dependent Care Tax Credit
  • Earned Income Tax Credit
  • Family and medical leave
  • Income tax policy
  • Medicaid/Children’s Health Insurance Program
  • Minimum wage
  • Supplemental Nutrition Assistance Program
  • Temporary Assistance for Needy Families
  • Unemployment insurance

The Effect of Rising Inequality on Social Security

February 27, 2015 Comments off

The Effect of Rising Inequality on Social Security
Source: Center for American Progress

The nation’s Social Security system has long been a bedrock of economic security, protecting nearly all American workers and their families in case of retirement, disability, or the death of a primary breadwinner. Some 239 million workers ages 20 and older are insured under the program. In 2013, Social Security provided benefits to 58 million people, including 41 million retirees and dependents of retirees, 6 million survivors of deceased workers, and 11 million disabled workers and dependents of disabled workers.

Over the past three decades, however, rising inequality has increasingly threatened the notion of shared economic security. Those at the top of the income spectrum have seen tremendous gains, while most Americans have watched their wages decline or stagnate amid rising costs. In the wake of the Great Recession, the top 1 percent of households captured roughly 76 percent of inflation-adjusted income gains between 2009 and 2013.

Much of the leap made by the very rich is attributable to nonwage forms of income such as capital gains, but huge disparities also persist when looking only at wages, which form the basis for Social Security tax revenues because payroll taxes only apply to wage income. In 2013, for example, the top 1 percent of earners took home about 12.9 percent of the nation’s total wage income in 2013—nearly as much as the share received by the entire bottom half of workers, who captured approximately 13.7 percent of wage income. This growing divide in wages—combined with the fact that wages in excess of the taxable maximum are exempt from payroll taxes—means that millionaire and billionaire earners stop contributing to Social Security early in the year, while the average worker contributes all year long. In 2015, individuals with wage incomes of $1,000,000 stop contributing on February 12; those with higher incomes stop contributing sooner.

Wage Stagnation in Nine Charts

February 26, 2015 Comments off

Wage Stagnation in Nine Charts
Source: Economic Policy Institute

Our country has suffered from rising income inequality and chronically slow growth in the living standards of low- and moderate-income Americans. This disappointing living-standards growth—which was in fact caused by rising income inequality—preceded the Great Recession and continues to this day. Fortunately, income inequality and middle-class living standards are now squarely on the political agenda. But despite their increasing salience, these issues are too often discussed in abstract terms. Ignored is the easy-to-understand root of rising income inequality, slow living-standards growth, and a host of other key economic challenges: the near stagnation of hourly wage growth for the vast majority of American workers over the past generation. Countering that by generating broad-based wage growth is our core economic policy challenge.

With a group of simple charts, this paper brings the challenge we face into sharp focus, and lends clarity to the steps we must take to meet it.

1,024 of 1,031 Highest Paid Federal Employees are VA Doctors

February 26, 2015 Comments off

1,024 of 1,031 Highest Paid Federal Employees are VA Doctors
Source: AllGov.com

Doctors working for the Department of Veterans Affairs are dominating the ranks of the highest paid federal employees, according to a new federal salary database.

Of the top 1,031 highest salaries in federal service, 1,024 belong to “medical officers” employed by the Veterans Health Administration. Leading the way among those physicians is Dr. Thomas Burdon, a specialist in thoracic surgery based in Palo Alto, California, who makes $402,462 a year. The next highest paid is Dr. Thomas Cacciarelli in Pittsburgh, Pennsylvania, who makes $873 less.

Government Executive reported that more than 16,900 federal employees made more than $200,000 in base salary last year. The database does not include the salaries of Department of Defense (DOD) personnel, according to Government Executive.

However, the three best-paid DOD personnel aren’t generals, admirals or anything like that. They’re football coaches. Army’s Jeff Monken tops the list with a guaranteed income of $1,680,000 in 2014, according to a survey by Newsday. He’s followed by Navy’s Ken Niumatalolo at $1,574,809 and Air Force’s Troy Calhoun at “only” $825,000.

Rise of the Machines: The Effects of Labor-Saving Innovations on Jobs and Wages

February 25, 2015 Comments off

Rise of the Machines: The Effects of Labor-Saving Innovations on Jobs and Wages (PDF)
Source: Institute for the Study of Labor

How do firms respond to technological advances that facilitate the automation of tasks? Which tasks will they automate, and what types of worker will be replaced as a result? We present a model that distinguishes between a task’s engineering complexity and its training requirements. When two tasks are equally complex, firms will automate the task that requires more training and in which labor is hence more expensive. Under quite general conditions this leads to job polarization, a decline in middle wage jobs relative to both high and low wage jobs. Our theory explains recent and historical instances of job polarization as caused by labor-replacing technologies, such as computers, the electric motor, and the steam engine, respectively. The model makes novel predictions regarding occupational training requirements, which we find to be consistent with US data.

From Hard Times to Better Times: College Majors, Unemployment, and Earnings

February 23, 2015 Comments off

From Hard Times to Better Times: College Majors, Unemployment, and Earnings
Source: Center on Education and the Workforce, Georgetown University
From press release (PDF):

The job market for recent college graduates has continued to improve but individual graduates’ chances of finding a job depends on their major, according to a new report by the Georgetown University Center on Education and the Workforce. The report is the third in a series of reports published by the Center that analyze unemployment rates for recent college graduates by major. The newest edition, Hard Times to Better Times, also analyzes changes in unemployment rates and annual wages for recent college graduates since 2009.

The report finds that college remains very much worth the cost in the post-recession economy for most students: unemployment rates declined for recent graduates in most majors. Recent college graduates are more likely to be employed than high school graduates in the middle of their careers in every major, with the exception of social sciences and architecture.

College graduates maintained their wage advantage over high school graduates in the post-recession economy, the report finds, though the size of the wage advantage depends on major: recent college graduates who majored in engineering earn 158 percent more than experienced high school graduates, while those who majored in education earn only 31 percent more than experienced high school graduates.

The report’s other major findings are:
• Unemployment rates for recent college graduates are the lowest for agriculture and natural resources majors (4.5%), physical sciences (5%), and education (5.1%). The majors with the highest unemployment rates are architecture (10.3%) and arts (9.5%).
• Recent college graduates who major in arts, psychology, and social work earn $31,000 per year, only $1,000 more than the average high school educated worker. By comparison, recent graduates who majored in engineering earn $57,000 per year, almost twice as much as the average high school graduate.

Nine Charts about Wealth Inequality in America

February 23, 2015 Comments off

Nine Charts about Wealth Inequality in America
Source: Urban Institute

Why hasn’t wealth inequality improved over the past 50 years? And why, in particular, has the racial wealth gap not closed? These nine charts illustrate how income inequality, earnings gaps, homeownership rates, retirement savings, student loan debt, and lopsided asset-building subsidies have contributed to these growing wealth disparities.

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